Copra Production and Unilever Combine

With the collapse in the copra market, the immediate outlook for coconut planting in the South Seas is very black indeed. It is a time when planters, de pendent in the past on copra, must give serious consideration to their condition.

The market is controlled by two great factors — First, over-production; second, the dominance of the Unilever combine.

Is it possible to secure, throughout the ranks of coconut-growers in the world, a sufficient measure of co-operation to per mit the producers to deal in some way with those two evils?

At first glance, it does not seem prac ticable. There are in the world six great groups of copra producers—namely, Africa, Ceylon, Malaya and Dutch East Indies, Phillipines, South and Central Pacific, and West Indies.

It may be noted that, in the last year (1930) for which complete figures are available, exports of copra from these various areas, in thousands of tons, were:

In each of these areas, again, there are two or three classes of producers the big planters, who conduct their plantations in a scientific manner; the small producers, white and coloured, whose production is partly efficient and partly haphazard; and, finally, the natives, whose methods are entirely primitive. Looking at those facts, one may say at once that it appears im possible to organise the producers them selves so as to control the world markets, as has been done in the case of tea, tin, etc., in recent years.

But each of the regions referred to is under the control of ordered government, and it is just possible that, if the various Administrations concerned could be brought together, a plan could be evolved under which the export of copra from the various Territories could be regulated. It

is a tremendous thing to envisage; but it appears now that an attempt at something of the sort is the only alternative to the collapse of the coconut-planting industry, as it has developed during the past quarter century.

If there were a free market there would be no need for special action. The evil of over-production would cure itself. The great economic law of supply and demand would operate as it has operated in past ages. Over-production would cause a fall in prices; production consequently would be reduced; buyers would begin to com pete one against the other for available supplies; and prices would rise again to a point which at least would permit the producer to live.

But there is no free market. In this post-War era, natural economic laws have been defied and broken. A world-wide system of growing complexity and vicious ness usually taking the form of aggres sive tariffs and Government subsidies has interfered in an extraordinary and grow ing degree with the law of supply and demand. The evil has been aggravated by the growth of trusts and combines, which clearly manipulate world markets, and direct the ebb and flow of money and merchandise, to suit their own purposes.

We know that low copra prices are

Africa— Philippines 171 Zanzibar 18 West Indies 16 Tanganyika 7 Pacific— Mozambique ... 17 New Guinea ... 64 East Indies— Fiji 24 Malaya 192 Solomons 24 D. E. Indies 370 Tonga 14 Borneo 9 Samoa 12 Ceylon 91 Papua 12

partly the result of over-production. But owing to the manipulation of the market by the Unilever combine we do not know the extent of that over-production; and consequently it becomes apparent that we cannot leave the ordinary law of supply and demand to cure the evils.

That brings us to consideration of another phase of the problem. Even if there could be concerted action among the Governments of Britain, France, Hol land, Japan and the United States to limit production, would not the benefits to the industry thus created be seized by the Unilever combine at the expense of the growers? We know that it is impossible for any single Government to control Unilever, which sits astride the margarine and soap industries in half a dozen Euro pean countries and defies any single Ad ministration; but would it be possible for half a dozen Governments, acting in unison, to deal with Unilever? We doubt it. The world of commerce and finance to-day is dominated by great trusts and combines, and as a general rule they snap their fingers at all Governments.

So, following out the argument as it affects the copra industry, we find our selves face to face with one of the great problems which now is troubling the whole civilised world namely, the domi nation of finance and trade by inter national financiers. If we are to free the copra industry entirely from the evils which now depress it, it is clear that we must go right back to Unilever. As that, apparently, is impossible the alternative is clear we must either abandon hope, or turn around and see what can be done in a more limited sphere. All that we can say in this connection, therefore, is that it is desirable that Administrations con cerned should consult together and seek the largest possible measure of inter national co-operation in order to save the industry. The alternative is at least the partial ruin of an industry involving hun dreds of thousands of primary producers and millions of capital.

Some people argue that the Unilever combine is not necessarily vicious that it may operate benevolently organising the market for the growers on the one side, and, by mass production and scientific methods, reducing prices to the con sumers on the other. All we can say is that no combine dominated by the need of making profits can possibly be other than vicious in the long run, and that this particular combine has operated to the detriment of the planting industry through out the world for several years. It has not only crushed out all competition in its particular field; but it also is largely re sponsible for the introduction of methods under which such commodities as whale oil, soya bean oil, etc., are deodorized and purified, so that these things may be used as substitutes for coconut oil. In ordinary circumstances such scientific discoveries are utilised for the benefit of consumers in particular and humanity in general. But this has not happened in the case of the Unilever combine. The commodities it manufactures and distributes throughout the world—soap, margarine, etc. have not been perceptibly reduced in price, and thus contributed to a lower cost of living;

but cheaper production has provided in creased dividends for the Unilever group of companies, even during the period of depression.

When first we discussed this position, three years ago, we pointed out that Unilever would defy governments. The great combine, through its groups of mills, was astride Great Britain, France, Ger many, Sweden, Czecho-Slovakia, Austria and Italy we named its several units in those countries. In such circumstances it seems impossible to control the operations of the organisation by Government action.

But to-day, under the imperative necessity of dealing with the deplorable condition of the coconut growing industry through out the world, it is just possible that con certed action by the nations concerned could do something to free the world’s copra markets from the grip of the octupus.

If the copra industry is left in its pre sent condition enormous losses, in the shape of ruined planters and plantations, will be incurred in the Territories con trolled by the following countries: Great Britain in her Colonies and Dependencies in Africa, Ceylon, Malaya, South Seas, West Indies.

Australia—through her Territories in Papua and New Guinea.

New Zealand through her Territories in Samoa and Cook Islands.

France through her Territories in Africa, Cochin China and the South Seas.

United States—through her Territories in Hawaii and Phillipines.

Holland—through her Territories in Dutch East Indies.

Japan—through her Territories in Caro line and Marshall Islands.

As it happens, there shortly will take place in Australia a Conference of Aus tralian Pacific Administrators. It is be lieved that Sir Murchison Fletcher, High Commissioner for the Western Pacific, will be in Australia at the same time. Here is an opportunity to bring up for discus sion the general or world aspect of the copra industry, and submit something for the consideration of the other nations concerned.

There is an opportunity, also, of initiat ing a research movement in regard to alternative uses for coconut oil. Hitherto this commodity has been used mostly for food, cleansing and toilet purposes. But there is little doubt that it has a lubricat ing value; and also it is of value as a fuel.

It is a common practice in certain places to use coconut oil or well-dried copra as an illuminant it burns with a clear white light. It was announced recently that a Japanese chemist had succeeded in adapt ing whale oil for lubricating purposes. If that can be done with whale oil, it surely can be done with coconut oil. This writer is under the impression that there is in use somewhere possibly in Africa—an engine called the Robey engine, which is run on vegetable oil. Is it not a reason able proposition that, since coconut oil is being displaced from its old uses by other commodities, as a result of scientific re search, we should seek by the same means to adapt coconut oil for use as a motor fuel, for which there is a world-wide and increasing demand? The chemist and the

laboratory expert, by applying new pro cesses to the rivals of coconut oil, have caused a vast disturbance of the copra industry. Would it not be poetic justice if the same expert chemist were to dis cover methods by which coconut oil could be used for engines and machinery?

Here then is a chance for Australia to give the world a lead in a matter of vital importance to tropical producers gener ally. There is need for control of coconut production; for consideration of the posi tion created by the Unilever combine; and there is most urgent need for well-directed research, so as to find new uses for coco nut oil.